Rural land transfer to help farmers

Allowing market transactions in rural construction land will undoubtedly benefit farmers. It's true that local governments' revenue depend, to a large extent, on transfer of land-use rights. But because of the central government's determination to control housing prices, land prices will not be determined solely by market demand, at least for the time being.

The Property Law of 2007 clarifies the policies to narrow the scope of land acquisition, regulate land expropriation procedures, enlarge the area for lease of State-owned land and reduce land allocations not conducive to public welfare.

The Constitution and the Property Law say that only for the purpose of public interests can farmers' land and homes be expropriated. Unfortunately, because of the Land Management Law and the Urban Real Estate Administration Law, local governments have been enjoying a monopoly in the land market. Local governments can acquire construction land and then allocate or transfer it to a developer to start construction on a project. Some local governments have been using the situation to acquire, at times with force, as much land as possible to earn more revenue. The resulting protests by farmers have led to increasing incidents of violence.

The reason for the increase in violence in land acquisition and demolition cases is also that farmers are not getting proper compensation in many cases. Also, land used for construction in rural areas should not include plots occupied by farmers' homes. But recent years have seen developers encroaching upon an increasing number of farmers' homes.

It is thus necessary to establish a guarantee system for landless farmers and a distribution mechanism of value-added income from land that takes into account the State, the collective and the individuals, and improve individuals' benefits reasonably.

The problem is that local governments still rely on land for a big part of their revenue, and the proportion is rising by the year. An increase in farmers' income means a cut in local governments' revenue. And the only way to increase the income of farmers and the government both is to sell land at a higher price. But can land users and homebuyers pay even higher prices? No.

The question then is: How to implement the spirit of the plenum's document, reform the land expropriation and compensation system and allow direct market transaction in rural construction land. Although there is no straightforward answer, the solution could be a more specific law on land-use rights in rural areas. Only a proper law can help the transfer of rural construction land without complications and to the benefit of farmers.

The author is a Beijing-based lawyer.

(China Daily 12/10/2013 page9)

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